Levin question for IRS: Who knew what, when?

In a lengthy, heated committee hearing on Capitol Hill, Steven Miller, the ousted head of the Internal Revenue Service, apologized to Congress on Friday for his agency’s tougher treatment of tea party and other conservative groups seeking tax-exempt status, but not before he was grilled by Democratic Rep. Sander Levin and especially by angry GOP lawmakers.

Levin, who was the first high-level Democrat to call for Miller’s ouster, said the IRS had “completely failed the American people.” But the veteran congressman seemed satisfied with the direction of the Obama administration’s response to the scandal, with Miller set to be replaced in the coming weeks. At the same time, he chastised his colleague, mid-Michigan Republican Rep. Dave Camp, who chairs the House Ways and Means Committee.

Camp said the targeted IRS examinations that conservative groups encountered seemed to be part of a “culture of cover-ups and intimidation in this administration.” He offered no other examples.

Levin, the committee’s top-ranking Democrat, said if the hearing became a partisan preview of the 2014 political campaigns, “we’ll be making a very, very serious mistake.”

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“… Those responsible for the failed management and oversight must be held accountable and the IRS must quickly implement the Inspector General’s recommendations to prevent this from happening again,” Levin said later. “The Congress should focus on getting the facts and fixing the problem, not trying to score political points.”

Levin said the committee’s goal should be to discover this: “Who knew what, when?”

Miller, under the gun for several hours at a rare Friday congressional hearing, said the agency’s “foolish mistakes” resulted from a misguided effort to handle a flood of applications for tax exempt status, not political bias.

“I want to apologize on behalf of the Internal Revenue Service for the mistakes that we made and the poor service we provided,” said Miller, who has been acting IRS commissioner, during the first of a series of hearings on the episode.

“The affected organizations and the American public deserve better. Partisanship and even the perception of partisanship have no place at the Internal Revenue Service.”

Levin repeated his contention that Lois Lerner, who heads the IRS division that makes decisions about tax-exempt groups, should be ousted too.

The Royal Oak Democrat, who represents most of Macomb County, said he was particularly miffed that Miller, Lerner and the previous IRS commissioner withheld information from Congress about the targeting of tea party and “patriot” groups for rougher IRS treatment.

“Former IRS Commissioner Shulman testified in front of us in March 2012 and said that ‘no targeting’ was going on. Two months later, he was briefed on the Inspector General’s investigation and was fully informed that, indeed, singling out by name had occurred on his watch. He had an obligation to return to this committee and set the record straight. So did Mr. Miller. Neither fulfilled their obligations,” Levin said.

“A little more than a week ago, Lois Lerner was in front of our Oversight Subcommittee. She … failed to disclose what she knew to this committee, choosing instead to do so at an (American Bar Association) conference two days later. This is wholly unacceptable, and one of the reasons we believe Ms. Lerner should be relieved of her duties.”

Miller, who was previously a deputy commissioner whose portfolio included the unit that made decisions about tax exempt status, denied that he misled Congress or the American public.

The IRS struggled, he said, to efficiently handle growing numbers of applications for tax exempt status. Between 2008 and 2012, the number of groups applying for tax exemptions as a 501(c)4 nonprofit group more than doubled. Along with that was an increase in complaints that such groups were largely engaging in electoral politics, which is not supposed to be their primary activity.

Also testifying Friday was J. Russell George, the Treasury Department’s inspector general for tax administration.

In a report he issued this week, George said IRS officials reported they were not politically pressured to target conservative groups. Asked about that conclusion, George said Friday, “We have no evidence at this time to contradict that assertion,” but in prepared testimony to the committee he said he is continuing to investigate that question.

George’s report concluded that the IRS office in Cincinnati, which screened applications for the tax exemptions, improperly singled out tea party and other conservative groups for tougher treatment. The report says the practice began in March 2010 and lasted more than 18 months.

Many of the groups were applying for tax exempt status as social welfare organizations, which are allowed to participate in campaign activity if that is not their primary activity. The IRS judges whether that imprecise standard is met.

Attorney General Eric Holder has said the FBI is investigating whether the IRS may have violated applicants’ civil rights.